US housing market ready to rebound

Washington, July 19 (IANS) The US housing sector was ready to get back to work while the construction industry continued to struggle on the jobs front, said the US mortgage giant Freddie Mac in a report.

Record-breaking low mortgage rates, supported by the Federal Reserve’s “Operation Twist”, had fuelled housing demand and led to a pick-up in housing starts, home sales, and even house prices in many markets, reported Xinhua citing the report Wednesday.

“While housing may not have played its traditional role coming out of the Great Recession, at the end of the day, it has turned a very large corner and now it’s time to get this sector back to work whether through construction jobs, remodelling, or home brokerage,” said Frank Nothaft, Freddie Mac’s vice president and chief economist.

However, the latest labour market reports showed that job creation continued but at a slower than expected pace during the second quarter. Overall, there was a net gain of 80,000 payroll jobs in June, bringing the total for the second quarter to 225,000, the lowest quarterly gain in employment in nearly two years and a lacklustre result when compared to the first quarter’s 677,000 job boost.

Employment in construction and mortgage finance continues to lag job gains elsewhere. Over the past 12 months overall payroll employment across all industries was up 1.8 million, yet construction employment was up a mere 13,000, well below the sector’s share of total employment, about 4.3 percent.

But housing demand had helped to increase hiring in the construction sector on a year-over-year basis, and the unemployment rate for construction workers has fallen 2.8 percentage points since June 2011.